India's Hydro Sector Needs An Impetus In 2017

The government of India has put in efforts to bring in reforms in transmission and distribution in India aiming at 24x7 electricity for all by 2021. There are also efforts to bring in similar reforms in India’s hydropower sector, which has been ailing for over 4-5 years now. India’s installed hydro base has remained in the 40k MW for the last 4 years with very incremental capacity additions. The renewables sector (solar and wind) have grown over 87% in the last decade while hydro caught up with only a meagre comparative increase of 28%.

 

- Neelav Samrat De

During the hydro boom, hydropower projects totalling about 60,000 MW were awarded to over 128 IPPs in the early 2000s. Till date, not a single project has taken off nor been commissioned. The current government is also trying to give a thrust by bringing in cross-border transmission agreements with Nepal and Bhutan. There are also talks of the new Hydro Power Policy and bringing all hydropower projects under the ambit of renewable energy (RE). This if implemented, would extend the benefits of RE to all hydropower projects including subsidies (Rs 1.5 to 20 crore/MW), tax benefits and power off take (RE defined projects get preferential sale of power). This in particular is aimed at bringing relief to private developers. This will work absolutely fine if hydropower comes under the RE ambit especially considering the fact that the share of RE has increased over 14% from a 3% share in 2005.